Deutsche Bank Pilots Payments Solution With IATA

Deutsche Bank has announced a pilot project with the International Air Transport Association (IATA), the trade association for the world’s airlines, to test a disruptive new payment model. Through the pilot, Deutsche Bank will look to reduce costs for processing payments between airline clients and airlines. Deutsche Bank will collect customer payments directly from accounts in line with the newly revised EU Payments Services Directive, PSD2. Currently, payments are mainly processed via credit and debit transactions.

The new payments scheme is designed to offer improved speed, security and transparency. Two-factor authentication will offer enhanced fraud protection for IATA and its member airlines. With direct payments being processed and received in near-real time, IATA’s member airlines will benefit from the acceleration of their funds. This targets working capital and liquidity benefits - reduced Days Sales Outstanding and the cost of funding for these airlines. Combined, the organisations say that these benefits stand to reduce the estimated US$8bn that IATA members currently incur from payment processing costs and fraudulent activity.

 

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